Premier Foods is set to exit several leases to reduce its costs by £20m annually.
The group said following the sale of its canning factories in Wisbech and Long Sutton in the half-year to 25 June, it could now restructure its property portfolio to fit a new supply chain model.
“The new supply chain will have smaller warehouses located nearer to the remaining grocery manufacturing sites. This will entail some onerous lease costs and dilapidations for the old warehouses, redundancy or relocation costs for the affected people and set-up costs for the new sites,” the Hovis maker said today.
Premier Foods is also expecting to reduce the size of its St Albans, Hertfordshire, head office.
In total, the programme will reduce costs by £20m a year. Access costs will be around £22m, of which cash costs will be around £18m.
In June, Premier Foods reappointed CB Richard Ellis to manage its property portfolio in the UK and Ireland. Its estate comprises around 200 properties spanning more than 4m sq ft.
joanna.bourke@estatesgazette.com
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